On the surface, the investment by US Nuclear Corp. in a San Diego company that makes components used in machine-brain interface devices might seem an unusual strategic decision. After all, the Canoga Park company’s main business is manufacturing radiation detectors for use at nuclear power plants. But Chief Executive Robert Goldstein doesn’t see it that way. “We consider ourselves in the sensor business and electrodes that go in the brain are sensors,” Goldstein said. US Nuclear is taking a 40 percent stake in Grapheton Inc., a startup founded by Sam Kassegne, the chief technology officer who is also an engineering professor at San Diego State University, and Bao Nguyen, the chief operating officer and vice president of operations, and a former student of Kassegne. The San Fernando Valley company will pay about $2.5 million over a two-year period for the investment, Goldstein said. “That is cash, stock and there are some in-kind services,” he added. “Some engineering time, some manufacturing time, some sales time that we will put in they will not have to pay for.” The investment will bring Grapheton out of the research and development phase as the company looks to commercialize its brain-machine interface products, Nguyen said. The company needs capital and he and Kassegne had talked about either going for venture capital funding or looking beyond the San Diego and Southern California region to fundraise, he added. “It is a good opportunity for us,” Nguyen continued. “We are looking to expand out of the R&D phase into an early production phase so that we can sell our products not to the consumer but to research facilities to develop the applications further and then go from there.” A machine-brain, or brain-computer, interface is a direct communication between the brain and an external device. Grapheton creates the electrodes that are implanted in the brain to allow that communication. It uses graphene, a carbon-based material that both Nguyen and Goldstein characterized as being superior to metal-based electrodes because it does not have oxidation, or rusting, issues when placed on the brain. The technology came out of research done at San Diego State under a National Science Foundation grant. “Sam’s lab had the responsibility to come up with the electrode material and that is where the core of our technology came from,” Nguyen explained. As a comparison to how he envisions the company progressing, Nguyen brought up YouTube and how the website went from all about content sharing and evolved into streaming services. “We want to be the YouTube for electrode needs for brain-computer interface or whatever that need might be,” Nguyen said. Machine-brain interface devices can be used on people with spinal cord injuries, or who suffer from chronic pain, Parkinson’s Disease, epilepsy, stroke and possibly Alzheimer’s. Melanie Fried-Oken, director of the REKNEW Projects at Oregon Health & Science University, called brain-machine interface devices a promising technology used for four main purposes – from an engineering perspective to understand how to obtain brain signals and process them; from a neuroscience perspective to understand brain function and anatomy; from a rehabilitation perspective to help individuals restore function they have lost due to disease or an accident; and from an industry perspective to help with enhancing attention or driving skills. In the area of rehabilitation, which is the one that Grapheton and US Nuclear will pursue, there are two different procedures – a non-invasive brain-computer interface relying on an external device to obtain brain signals; and an invasive procedure where surgeons put a circuit board on someone’s brain. “I think that is what this company (Grapheton) is making, the circuit board that could be used for internal BCI,” Fried-Oken said. One of the most promising invasive brain-computer interface projects being done is BrainGate, a partnership between researchers at Brown University, Stanford University, Case Western Reserve University and Massachusetts General Hospital, she added. “They have been able to show for rehab restoration using an invasive BCI functional gains that are beautiful,” Fried-Oken said. “I think at this point it is being done on six adults.” Stock price boost US Nuclear is publicly traded on the over-the-counter market. The company has three subsidiaries – Technical Associates in Canoga Park, which makes radiation detection equipment; Overhoff Technologies in Milford, Ohio, which specializes in tritium detection equipment; and Electronic Control Concepts, also in Milford, which makes voltmeters to check industrial and medical X-ray machines. For the quarter ending Sept. 30, the most recent data available, the company reported a net loss of $1.4 million (-8 cents a share) compared with a net loss of $1.4 million (-9 cents) in the same period a year earlier. Revenue decreased by 42 percent to $659,325. The stock price went up after the announcement of the Grapheton investment, pushing US Nuclear above the $1 mark for the first time since November. The share price closed at $1.14 on Feb. 26. In addition to the sensor connection between US Nuclear at Grapheton, Goldstein said he has a personal interest in learning how the brain operates, dating back to when he was a graduate student at Stanford University. “I read a little bit about it and try to educate myself,” he added. Goldstein met Kassegne and Nguyen through a mutual friend. “He came in and spent some time at the lab at the university and the conversation started from there,” Nguyen recalled. Grapheton was founded and incorporated in 2017 and has one employee other than Nguyen and Kassegne. The company does have some revenue coming in but not a lot, Nguyen and Goldstein both said. “Right now, we are doing more custom work and we want to get into being an (original manufacturer) for a big customer or to develop our own product line,” Nguyen added. Exit strategies US Nuclear only took a 40 percent stake in Grapheton rather than 51 percent or the entire company because, Goldstein said, he wanted Kassenge and Nguyen to feel it is still theirs. “The eventual expectation is they will be part of US Nuclear, but I do think they may get to a point where some big company wants to buy them for a large multiple, in which case we would have to decide on that,” Goldstein said. “If we are at 40 percent, we get to have a say in it.” As part of its agreement with Grapheton, US Nuclear will provide systems engineering, manufacturing and marketing support. It will assist in helping the company to develop a suite of machine-brain interface equipment. Sales and marketing are not a strong suit for the team at Grapheton, Goldstein said. “They are focused on new development and serving the customer, but they don’t want to waste their time on sales and business management,” he added. “That is something we can easily help them with.” Nguyen sees the investment opening opportunities beyond the brain-machine interface. “We believe that graphene has a lot more applications and we are only barely breaking the surface of new applications,” he said.